Biggest HMOs See Margins Slip
LANSING — West Michigan’s two largest health maintenance organizations, Blue Care Network and Priority Health, saw their net income slide in 2006, according to annual reports filed today with the Michigan Department of Labor and Economic Development’s Office of Financial and Insurance Services.
Meanwhile, Grand Valley Health Plan, a local staff-model HMO, climbed out of 2005’s net loss into the black.
Grand Rapids-based Priority Health, majority-owned by Spectrum Health, posted net income of $22.3 million on total revenues of $1.08 billion for 2006. In 2005, the nonprofit HMO collected a net income of $57.8 million on total revenues of $1.04 billion. Total enrollment slipped from 372,107 in 2005 to 344,469 in 2006.
Blue Care Network, headquartered in Southfield with its parent, Blue Cross Blue Shield, posted a net income of $28.3 million on revenues of $1.56 billion for 2006. In 2005, the nonprofit HMO reported a net income of $78.3 million on total revenues of $1.43 billion. Membership gained in 2006 at 482,998, compared to 452,163 in 2005.
Grand Valley reported total revenues for 2006 at $39.3 million, down from $45.5 million in 2005. But the HMO record a net income of $407,302 for last year, compared to a $439,045 loss in 2005. The HMO has seen a steady erosion in membership over the past five years, down to 11,698 in 2006 from 15,546 in 2005. Both are less than the 19,561 members reported for 2002.